Interesting little court case I came across....

[Randall Flagg]

What a dollar is...

The U.S. dollar was created and defined by the Coinage Act of 1792. It specified a "dollar" to be based in the Mexican peso at 1 dollar per peso and between 371 and 416 grains (27.0 g) of silver (depending on purity) and an 'eagle" to be between 247 and 270 grains (17 g) of gold (again depending on purity). The choice of the value 371 grains arose from Alexander Hamilton's decision to base the new American unit on the average weight of a selection of worn Spanish dollars (and later Mexican peso). Hamilton got the treasury to weigh a sample of Spanish dollars and the average weight came out to be 371 grains. A new Spanish dollar was usually about 377 grains in weight, and so the new US dollar was at a slight discount in relation to the Spanish dollar. The gold equivalent of the Spanish dollar in sterling was ₤1 = $4.80, whereas the gold equivalent of the US dollar was ₤1 = 4.86⅔. This exchange rate with sterling remained right up until Britain abandoned the gold standard in 1931.

The Coinage Act of 1792 set the value of an eagle at 10 dollars, and the dollar at 1/10th eagle. It called for 90% silver alloy coins in denominations of 1, 1/2, 1/4, 1/10, and 1/20 dollars; it called for 90% gold alloy coins in denominations of 1, 1/2, 1/4, and 1/10 eagles.

The value of gold or silver contained in the dollar was then converted into relative value in the economy for the buying and selling of goods. This allowed the value of things to remain fairly constant over time, except for the influx and outflux of gold and silver in the nation's economy.

what coinage act came along and said, the dollar is now a worthless paper note backed by nothing?

 

[Randall Flagg]

Again, you didn't ask that question. Semper Fi pointed out that it was hard to understand what you were getting at and you asked what law or amendment required the States to take currency as payment for a debt. I posted such a law. Now you are changing the question. You didn't ask about authority to make the law. The statute doesn't say state, it says all debts. So if a state has a debt, currency could be used to pay that debt.

If you have a different question, go ahead and ask, but stop saying I don't understand something when I provide an accurate response to your question.

LEt me rephrase it better then.

what law says "states must take what congress decides to make legal tender" and where did that power come from cause it's not in the constitution anywhere.

 

[Randall Flagg]

According to you guys, it would be perfectly legal by the constitution to make dogs balls legal tender, and the states would have to accept them.

 

[CarmelHP]

Yes congress was allowed to issue credit on the us, backed by gold/silver, this is already widely known.

Really, I thought you said that they could only issue "coin" which excluded paper money according to you. How was as little $2M in bullion "backing" the $10 million in paper currency that was authorized.

All you need to do is look up "what" a dollar is, and you will find that it is a weight of silver, not a worthless backed by nothing piece of paper.

The first bank was also disbanned after it's 20 year charter was up, for reasons that i've stated....i.e trying to get off the gold/silver standard.

You mean a gold/silver standard that it was never on? The Second Bank was chartered a mere 5 years (1816) after the charter of the First Bank expired as the federal treasury found it was having trouble financing the debt after the War of 1812 was over on almost precisely the same terms as the First Bank. You're arguing for a phantom of you're own creation, apparently.

 

[Bill of Rights]

Without the vitriol, I also question the source of Congress' authority to print money or to designate other than gold or silver as money. That it was done by Washington, Madison, Hamilton, et al, does not place that authority in the Constitution, as mandated under the 10A.

There isn't a lot of point to it, as it's not something I have enough gold, silver, or FRNs to finance a challenge against, however at this point, I'm asking out of academic curiosity.

Edit: And I have to step away for a while, but I'll be back to read later. Thanks for your informative answers.

Blessings,
Bill

 

[Randall Flagg]

Really, I thought you said that they could only issue "coin" which excluded paper money according to you. How was as little $2M in bullion "backing" the $10 million in paper currency that was authorized.

Congress could only issue coin, thats why the first bank was created, it ALONE issued paper notes backed by gold/silver.

You mean a gold/silver standard that it was never on?

so your saying the first bank of the us was not on a gold/silver standard, but rather a fiat standard?

please post sources on this.

 

[CarmelHP]

According to you guys, it would be perfectly legal by the constitution to make dogs balls legal tender, and the states would have to accept them.

Doesn't say anything about copper, does it? But, the same year as the Coinage Act of 1792, there was An Act to Provide For a Copper Coinage signed into law by George Washington that specified, " Furthermore, "no copper coins or pieces whatsoever except the said cents and half-cents, shall pass current as money, or shall be paid, or offered to be paid or received in payment for any debt, demand, claims, matter or thing whatsoever." Apparently, the authors of the Constitution were less well versed in exactly what they meant than you. And you seem to suggest that Congress could make some form of silver bullion legal tender, but not the reverse, which is certainly a new take on legislative power.

 

[Randall Flagg]

Doesn't say anything about copper, does it? But, the same year as the Coinage Act of 1792, there was An Act to Provide For a Copper Coinage signed into law by George Washington that specified, " Furthermore, "no copper coins or pieces whatsoever except the said cents and half-cents, shall pass current as money, or shall be paid, or offered to be paid or received in payment for any debt, demand, claims, matter or thing whatsoever." Apparently, the authors of the Constitution were less well versed in exactly what they meant than you. And you seem to suggest that Congress could make some form of silver bullion legal tender, but not the reverse, which is certainly a new take on legislative power.

I'm not really sure how you guys are not getting this.

lets say for example that in the constitution it says congress can make whatever it wants legal tender.

lets say dog turds.

does this cancel out states accepting only silver/gold as payment for debts?

No it does not, to do that would take an amendment to the constitution.

notice it does not read that states can designate gold/silver/whatever legal tender the fed deems.

 

[Randall Flagg]

Doesn't say anything about copper, does it? But, the same year as the Coinage Act of 1792, there was An Act to Provide For a Copper Coinage signed into law by George Washington that specified, " Furthermore, "no copper coins or pieces whatsoever except the said cents and half-cents, shall pass current as money, or shall be paid, or offered to be paid or received in payment for any debt, demand, claims, matter or thing whatsoever." Apparently, the authors of the Constitution were less well versed in exactly what they meant than you. And you seem to suggest that Congress could make some form of silver bullion legal tender, but not the reverse, which is certainly a new take on legislative power.

also, even if congress did make copper pennys tender, the constitution does not allow the states to accept them as payment does it?

 

[CarmelHP]

also, even if congress did make copper pennys tender, the constitution does not allow the states to accept them as payment does it?

The Constitution does not, in any way, in any part you've cited, prohibit the states from accepting whatever. It says that states shall not designate anything as legal tender other than gold or silver. So, if Indiana wants to say that gold and silver are legal tender, it may do so, and the citizens of Indiana would be bound to accept it as payment along with national legal tender. Indiana can not designate dog turds as legal tender, Congress can. You're reading additional words into the text that simply are not there.

 

[Randall Flagg]

The Constitution does not, in any way, in any part you've cited, prohibit the states from accepting whatever

seriously dude? thats your defense?

No State shall make any Thing but gold and silver Coin a Tender in Payment of Debts

does that part right there make it immpossible for them to take anything BUT gold and silver as payment for debts?

am i reading it wrong? does it really mean take whatever you want as payment of debts?

 

[CarmelHP]

seriously dude? thats your defense?



does that part right there make it immpossible for them to take anything BUT gold and silver as payment for debts?

am i reading it wrong? does it really mean take whatever you want as payment of debts?

Yes, it does, the states just can not force ANYONE ELSE to take other than gold or silver as legal tender. Seriously "dude," it's not that hard to comprehend.

 

[dross]

"shall not make..." not "shall not accept..."

Please address how you draw the conclusion that these two phrases mean the the same thing.

 

[Ramen]

On the issue of the "Coin Money" phrase, I will say that the Founders most certainly knew the pitfalls of a fiat currency. The British army used counterfeiting to inflate the currency and try to bankrupt the colonies.

Digital History


Also, James Madison believed that paper currency could only be held accountable if it could be exchange for "specie", or bullion coins.

You can view the full quote on page 8 of http://www.cato.org/pubs/journal/cj9n2/cj9n2-1.pdf

Still, they may have taken a more general view when they wrote the phrase. But with the problems they faced during the Revolution, I doubt it.

 

[beararms1776]

Where in the constitution does it give the federal government the right to make nike tennis shoes legal tender if they want?

Man don't say that. I just bought my son a pair at Shoe Carnival.

 

[Randall Flagg]

Yes, it does, the states just can not force ANYONE ELSE to take other than gold or silver as legal tender. Seriously "dude," it's not that hard to comprehend.

i did not say the states could force anyone else to take silver/gold. the feds or persons can take whatever they like i suppose.

however according to the constitution(unless you have an amendment i dont know about) the states can not make ANYTHING BUT gold/silver as payment for debt.

it's right there.

make anything but

like if you told me not to make anything but chessecake for your birthday, would you expect me to show up with carrotcake?


It's 3 frickin words for crimeys sake, how hard is to understand "make anything but"

 

[Randall Flagg]

"shall not make..." not "shall not accept..."

Please address how you draw the conclusion that these two phrases mean the the same thing.

MAKE ANYTHING BUT


what does that mean to you sir?

 

[dross]

Make:

Build: As in, "I made this house."
Cook: As in, "I made dinner."
Designate: As in, "I made him the boss."
Create: As in, "I made that painting."

I think "designate" is the operative word here.

So, the state may not designate anything but gold or silver as legal tender.

As to what the state may "accept" as payment of debt appears to be unaddressed.

Now, I've been polite throughout this exchange. Your one phrase answer in all caps was condescending. I carefully explained how I see it. Do me the courtesy of addressing what I'm saying specifically. There are some intelligent folks who see it differently than you do. That doesn't mean they are right, just that clearly reasonable people can disagree.

 

[Randall Flagg]

Make:

Build: As in, "I made this house."
Cook: As in, "I made dinner."
Designate: As in, "I made him the boss."
Create: As in, "I made that painting."

I think "designate" is the operative word here.

So, the state may not designate anything but gold or silver as legal tender.

As to what the state may "accept" as payment of debt appears to be unaddressed.

Now, I've been polite throughout this exchange. Your one phrase answer in all caps was condescending. I carefully explained how I see it. Do me the courtesy of addressing what I'm saying specifically. There are some intelligent folks who see it differently than you do. That doesn't mean they are right, just that clearly reasonable people can disagree.

Of course, sorry it came out that way, now, where did you get designate from?

make any Thing but gold and silver Coin a Tender in Payment of Debts

The state can not designate anything as tender

No State shall coin Money

As to what the state may "accept" as payment of debt appears to be unaddressed.

really, because it looks pretty clear to me what the state can accept for payment of debts

make any Thing but gold and silver Coin a Tender in Payment of Debts

that pretty much says to me, you cant make anything else but silver and gold as a tender of payment of debts.

it does not say, gold/silver/dog turds/whatever the fed decides is legal tender.

it says make anything but gold and silver a tender in payments of debt.

 

[dross]

Of course, sorry it came out that way, now, where did you get designate from?





The state can not designate anything as tender






really, because it looks pretty clear to me what the state can accept for payment of debts



that pretty much says to me, you cant make anything else but silver and gold as a tender of payment of debts.

it does not say, gold/silver/dog turds/whatever the fed decides is legal tender.

it says make anything but gold and silver a tender in payments of debt.

Okay, follow this path.

I owe you a debt of 100 dollars.
I attempt to pay that debt. Can you refuse my offered payment?
Yes, if it is NOT legal tender.
If I offer you 100 dollars worth of chickens, you may refuse my payment, and the debt remains.
If, however, I offer you legal tender, you must accept and my debt must be released.
Tender is that which may not be refused as payment for debt.

Now, what can the states do? Well, let's say that the chicken farm lobby tries to get chickens made to be legal tender. If that passed into law, I could show up to pay off my debt with 100 dollars in chickens, and my debt would be released by law.

The Constitution forbids the states the power to make chickens a legal tender. The only legal tender the states my designate (make) as legal tender to pay off a debt, is gold and silver.

None of this has anything to do with federal money, which is soley the province of Congress.